Tourism, Leisure and Sport (Hansard, 17 December 1998)

§ Mr. Tom Pendry (Stalybridge and Hyde)

It says here, "What a great pleasure it is to be called at this time." [Laughter.] It is especially fitting to have secured the Adjournment debate on the subject of tourism, sport and leisure just before the House—and the country—turns its attention to the Christmas period, when there will be much enjoyment of, and participation in, all such activities.

I want to address not just the pleasure that those activities bring to millions of people in this country, but the crucial economic contribution that they make to our economy. In the past generation, sport, tourism and leisure have grown to become one of the largest and most important contributors to today's modern economy. Sport and leisure now employ some 750,000 people, and every year more than £10 billion is spent on sport consumer products.

The Treasury receives £3.5 billion in tax revenues from the sports industry. On an even larger scale, tourism now contributes more than £53 billion to the economy and provides 1.7 million jobs. In 1997, 26.2 million visitors came to Britain. It is estimated that, in the next 10 years, 400,000 new jobs will be created in that sector, given the right conditions for growth and support from the Government. It is that support that I and some 220,000 small and medium-sized firms seek. I am still concerned that sport, leisure and tourism, which have many interlocking synergies, are not given sufficient recognition by the Government as true economic powerhouses and in terms of their potential for growth.

Earlier this week, my right hon. Friend the Secretary of State for Culture, Media and Sport announced major reforms of the Government's funding of cultural activities. It was disappointing to note that there was little increase in funding for sport and tourism. In economic terms, tourism is by far the biggest and most important component of the Department for Culture, Media and Sport. In some cases, it provides the wealth that subsidises other components of the Department such as the arts and museums.

The British Tourist Authority achieves a return for the UK economy of £27 for every £1 of public money spent on marketing abroad. The fact that it is to reallocate £5 million to spend on marketing in key markets is welcome, but I think that the Secretary of State could have granted a larger increase in its budget, especially when one realises that such expenditure leads to an increase in Exchequer revenue, as visitors from overseas pay various direct and indirect taxes.

We await with interest the more detailed proposals for the restructured English tourist board. We are told that it will be more strategically focused. We must ensure that it plays a positive role in promoting the attractions of leisure and tourism that England offers in the United Kingdom marketplace. I welcome the renewed commitment to the industry shown by the Secretary of State through the expanded tourism forum, which was set up when we were in opposition, and which he chairs. I welcome the enthusiasm that the Minister for Tourism, Film and Broadcasting has brought to her job. I am pleased that she 1196 is replying to the debate. I know that since her appointment she has consulted widely on a new tourism strategy, which is set to be published early in the new year. As chairman of the all-party tourism group, I await that development with great interest.

I hope that my hon. Friend the Minister will not ignore the thinking that the party has already undertaken on the subject. In opposition, we undertook extensive consultation with many sectors of tourism and the hospitality industry. Much of that work was done in partnership with the industry forum, and we subsequently received much praise from the industry's leaders when we published our policy document "Breaking New Ground—Labour's strategy for tourism and hospitality". That comprehensive policy document, which set out a strategy for the tourism industries, was published before the election by me and my right hon. Friend the Member for Copeland (Dr. Cunningham), who, as shadow Secretary of State for National Heritage, had responsibility for tourism.

Our document contained a range of policies and initiatives to improve our tourism infrastructure and economy. They involved updating tourism structures, enhancing standards, co-ordinating overseas marketing and investing in people. The centrepiece of our tourism policy, and a commitment that I hope will be reiterated in the forthcoming tourism strategy, was the proposal to introduce a new development of tourism Bill. It is now 25 years since a previous Labour Government introduced the Development of Tourism Act 1969, the first and only such legislation, which gave a coherent focus to tourism, marketing and promotion. Clearly, in that time circumstances have changed and new challenges have arisen.

As tourism grows to be the world's biggest industry and becomes such a mainstay of our economy, it is vital that we review and update the structures of government support. I was therefore encouraged to note that, in the "New Cultural Framework" document, reference was made to the Department's hope of finding an opportunity to amend legislation to ensure that England, Scotland, Wales and London were formally represented on the board of the British Tourist Authority.

An issue of concern to a significant sector of the tourism industry in London is the development of tourism on the Thames. Such tourism has grown immeasurably in recent years, with new markets and considerable investment, following the Port of London Authority's "partners in progress" programme. The Thames now attracts 2 million visitors a year, generating a revenue of between £20 million and £30 million a year, yet London still lags behind cities such as Paris in its exploitation of the river as a tourist attraction.

In April 1999, as the House knows, responsibility for all river functions will pass to London River Services, a newly formed subsidiary of London Transport. There is a concern that the new body will focus on transport to the detriment of tourism, jeopardising the considerable investment that operators have in our river.

I know that it is the intention of the Department to be represented in every regional office, and to play a much greater role in interdepartmental liaison. Can my hon. Friend assure me that she will look into the matter and make inquiries of the Department of the Environment, Transport and the Regions and the Government office for London, to ensure that tourism is fully integrated in the management of the river under London Transport?

1197 In economic terms, tourism is one of Britain's largest export industries. I wish to raise some of the concerns in the industry about the high taxes that we place on the product. Our VAT rate on hotel accommodation is the second highest in Europe. Other countries have taken advantage of our uncompetitive decision by reducing their VAT rates on hotel accommodation and attracting more visitors. I know that a report on the matter prepared by the BTA is before Ministers, and I urge them to consider it carefully.

In a move that was even more damaging for tourism, the previous Government introduced and then doubled the rates of air passenger duty. It is the only unit tax that I know on an export product. Every visitor to Britain from Europe must pay £10 when catching a flight to the UK and £20 if travelling from outside the European Union. If visitors decide, as many do, to fly to Scotland, for example, or one of our regions, they must pay even more tax. That is damaging tourism growth, especially in Scotland and the regions—areas that often depend most on tourism.

Recent figures released by the British Incoming Tour Operators Association reveal a 4 per cent. fall in visitor numbers during 1998, at a time when cool Britannia should be giving us a marketing edge on our competitors. Clearly, by doubling APD, the previous Government played a contributory part in the fall in numbers. APD damages our balance of payments and stymies further employment opportunities. I urge my hon. Friend and her colleagues in the Department to raise the issue with the Chancellor so that he does not repeat the Conservatives' folly by further increasing rates of APD.

Before dealing with our most played and spectated sport, football, I shall touch on sport in general, which is a great earner for the British economy. Horse racing is often overlooked when sport is debated in the House. British racing is not only a leading spectator sport, but a major industry contributing massive amounts of revenue to our economy.

More than 100,000 people are employed in the racing and betting industries, including one in eight agricultural workers. Racing and breeding generate exports worth more than £90 million a year and income exceeding £600 million a year. About £450 million a year is raised in tax and betting duty through betting on horse racing. There are more than 5 million racecourse attendances a year. Those figures indicate the scale of the sport and its importance to our economy. A study by KPMG in 1996 estimated that one in 15 racegoers is a tourist and therefore an overnight stayer. In 1996 about 330,000 tourists visited racecourses, of whom half were likely to be from overseas.

The British Horseracing Board this year launched a financial plan that aims to secure the future of British racing on the international stage, as well as creating more jobs, raising more revenue and improving education and training opportunities in that industry. I hope that the Government will carefully examine the board's proposals and acknowledge the importance of the sport to our economy and culture.

Next year's sporting calendar shows that in 1999 Britain will host a number of major sporting events, including world cup rugby and cricket tournaments, world 1198 judo and orienteering championships, as well as the much cherished annual events such as Wimbledon, open golf, Ascot and the Derby.

It has been suggested by the national association for the governing bodies of sport that the Government adopt a tax exemption for sporting events parallel to that afforded to the UK film industry. The idea is to introduce a tax exemption that would assist governing bodies which host international bodies and sporting events, which, through tourism and related services, would bring considerable economic benefits to Britain. I hope that my hon. Friend the Minister will pass that message on to the Chancellor. She will be busy talking to him.

Not only do we see the huge economic potential of sport, but it has considerable importance in promoting a healthier nation. A report published only this week reveals that 23 per cent. of young men and 19 per cent. of young women are overweight. Therefore, the promotion of sport not only benefits the Exchequer but leads to reduced demands on the NHS. The spending review, however, contains only a meagre increase in grant-in-aid for sport of £3 million in the period 1998 to 2001. Compared with grants to the arts and museums, that is insignificant. The sports world fears that it is being penalised for being efficient with its money and successful in its commercial activities.

I must declare my interest as chairman of the Football Trust. It is true that the game is riding high at the moment—despite the unwelcome developments of the past few days at the Football Association, to which I will return later—compared with the 1980s, when, as chairman of the all-party football group, I and fellow members of the group worried for the very future of the game. Yet there is still a threat, and that is the persistent menace of the football hooligan. That is why I so warmly welcome the Government's statement last week on further legislation to clamp down on football hooligans, especially those who tarnish our name abroad.

I must gently chide some Ministers for not recognising, when announcing so-called new policies, that many of the proposals have been Labour party policy for some time and were endorsed by the electorate. The failure to attribute the consultation and work that went into their development is, to say the least, disingenuous. Many of the proposals launched by the Home Office were contained in the charter for football launched before the election. Had the previous Government heeded our calls for such measures, we might not have had to witness some of the world cup scenes with so few powers at our disposal to deal with them.

It is vital that such measures reach the statute book quickly. The United Kingdom is in a leading position to host the world cup in 2006, which would bring enormous benefits to the UK economy. Euro 96 brought a significant increase in the number of visitors to the country, bringing vital foreign exchange earnings with them.

I hope that the Government's new sports strategy, also due this Session, will refer to the potential of sport to promote tourism and economic growth through Britain hosting major international sporting events.

If we are still to make a credible bid for the world cup in 2006, which I am sure that we will and can as we have an excellent case, backed by superb stadiums, and a proven track record, our ability to manage and control our 1199 small yet persistent minority of soccer hooligans is vital. I am concerned that the Government see fit to leave such matters to the parliamentary tightrope of a private Member's Bill rather than bring them forward as a Government measure. We cannot underestimate the deadlines that we are up against. Euro 2000, to take place in Belgium and Holland, is just 18 months away. We must have legislation on the statute book to ensure that we do not see a repeat of some of the scenes in France.

The economic potential of hosting major international sporting events for the UK is huge. The successful Euro 96 football competition brought the Exchequer approximately £60 million from taxes on products such as tickets, accommodation, food and drink, and from corporation tax. That is why the new sports cabinet must address urgently issues such as the future of Wembley stadium, and the establishment and day-to-day running of the Sports Institute and its regional academies—a policy promoted not by the former Prime Minister but by the late and greatly missed Denis Howell in opposition following extensive consultation with the sporting world.

Those are the fundamentals that must be in place if we are successfully to bid for and win the right to host major events. I, for one, applaud the efforts of my hon. Friend the Minister for Sport in travelling the world, seeking support for England's bid to host the world cup in 2006. It is the day-to-day involvement of a member of the Government that will make a difference to the perception of our bid by the representatives of other countries.

There is currently consultation on the Government's sports policy. Again I urge the Minister to reflect carefully on "Labour's Sporting Nation", the sports policy document that I launched during the election campaign. It set out the framework for a national strategy for sport covering such issues as school and youth sport, broadcasting, tackling drug abuse, local authority sport, reform of the lottery and the restructuring of sport. In that restructure it was our clear intention to make the Sports Council the lead strategic body for sport. That has still to occur to any meaningful extent, so I hope that it will feature in the sports strategy.

Finally, I turn to Tuesday's events, which rocked the football world. I do not know the details of the events which led to the vote of no confidence in Mr. Wiseman, the chairman of the Football Association and the resignation of Graham Kelly, the chief executive, but it has been clear for many years that the FA needs restructuring. Personally, I am saddened by Mr. Kelly's departure. He is a man of great integrity and his love of football is obvious to all who know him. I am sure that the House joins me in wishing him well in future.

David Davies, the acting chief executive, recognises the need for changes in the structure of the FA and I hope that he will be given every opportunity to kick start the process of change. I am sure that the House wishes him well in that task.

Our document "A New Framework for Football—Labour's Charter for Football" was endorsed by the National Executive Committee and the shadow Cabinet as well as the FA, the Premier League, the Professional Footballers Association and the supporters' organisations and others. It had a foreword by the then Leader of the Opposition, now my right hon. Friend the Prime Minister. It stated: Restructuring is underway at the Football Association, reflecting a long-established need for change. We welcome this recognition of the changing pressures and situations within the game. Labour's 1200 view is that further modifications to the Football Association's Executive Committee would bring about quicker decision-making and ensure a better say for the professional game. Labour would not wish to see football divided, and there has never been a greater need for coherence and consistency. Football deserves nothing less than a Football Association, fit for the 21st century, to oversee the game. That was our policy at the general election and I trust that it is now. I hope, therefore, that Ministers will adhere to the words of the Prime Minister in the foreword: It is up to the Government working in partnership with the football authorities and other interested organisations to ensure that the right framework for football is created. Only when the appropriate structures are in place will we see a Football Association leading soccer at every level to where it deserves to be led.

It was always my hope in 28 years in the House to see sport and latterly tourism elevated to their rightful places in the higher echelons of government. I hope that the present Government will fulfil that wish.

§ The Minister for Tourism, Film and Broadcasting (Janet Anderson)

I congratulate my hon. Friend the Member for Stalybridge and Hyde (Mr. Pendry) on securing tonight's Adjournment debate and thank him for his kind words. As he said, I am extremely enthusiastic about my new role as Minister for Tourism, Film and Broadcasting. He will know that one of the first things that I did was to change the order of my title to reflect the particular importance I attach to tourism. I also pay tribute to the work that my hon. Friend does as chair of the all-party tourism group. My hon. Friend spoke about the need for Government support for those sectors. I assure him that we are very much aware of that, and of the importance of those sectors to the economy.

The Department for Culture, Media and Sport needs a champion for the industries who recognises their important contribution to the economy. We have such a champion in my right hon. Friend the Secretary of State.

My hon. Friend has raised many different issues. I hope that he will forgive me if I do not respond to them all, but I shall do my best. He spoke about VAT rates on hotel accommodation. As he said, the Treasury is considering a report on that. He also referred to air passenger duty and his fear that any increase in that duty would damage tourism. He knows that that fear is shared by others. It is a good example of the Department having to undertake what my right hon Friend the Prime Minister calls joined-up government. I assure him that the industry's concerns about that matter have been conveyed to the appropriate places.

My hon. Friend also spoke at length about sport and its contribution to the economy. He spoke about horse racing and the number of people who visited race courses. We shall look carefully at the board's proposals.

I pay tribute to my hon. Friend again—he has so many hats that I could probably continue to do so for many hours—and thank him for the work that he has undertaken in his first 12 months as chairman of the Football Trust. Like him, I welcome the Government's intention to clamp down on football hooliganism. As he knows, the Minister for Sport, my hon. Friend the Member for West Ham (Mr. Banks), will propose a sports strategy. I repeat what my hon. Friend said and applaud the Minister for all that he is doing to try to bring the world cup here in 2006.

1201 My hon. Friend was way ahead of us all: in opposition, he produced a document entitled "Breaking New Ground—Labour's strategy for tourism and hospitality". I assure him that the Department has used it as a guide in drawing up our strategy, which we shall publish in the new year. My hon. Friend was one of the first people to recognise both the importance of tourism and hospitality to the economy and the fact that it is the world's largest and fastest-growing industry. We now know that, in this country alone, tourism contributes some £53 billion a year to the economy and employs some 1.7 million people.

The Government want to deliver what my hon. Friend promised in opposition: to assist Britain in attaining an unassailable position as one of the world's most popular tourist destinations, and to establish tourism as a source of national pride by encouraging investment in our infrastructure, communities, attractions and people.

We have already gone some way towards meeting the objectives that my hon. Friend set out comprehensively in opposition. The first is the strategy, which is now almost ready. He referred to the outcome of the departmental spending review, particularly to the restructuring that we intend to carry out. That was decided after a wide consultation, to which we had more than 300 responses. I reassure my hon. Friend that its purpose was not to cut funding to tourism. My right hon. Friend the Secretary of State made it clear that it was about trying to assess whether there was a better and more effective way of spending our funding in support of the tourism industry.

Virtually all the responses called for a smaller, more streamlined national strategic body to oversee English tourism. As we announced on Monday, that is how we see the way ahead. That body will concentrate on only five key areas: innovation; research; quality standards; disseminating best practice; and overseeing information systems. Funding in support of English tourism will be maintained, but a greater proportion will go to the regions for the direct provisions of services. I represent a beautiful constituency in the north-west, so I welcome that.

We shall also work alongside other regional cultural organisations and development agencies. It is a chance for the regional tourist boards to develop a more strategic role. We must look carefully at the exact relationship between the national body, the regional development agencies and local authorities, and develop it, because it is important.

My hon. Friend mentioned the British Tourist Authority. We were pleased to announce that the BTA will be provided with above-inflation increases next year and the year after. It is the first real increase in funding to tourism for many years. Under the previous Government, funding to the English tourist board dropped from £25 million to just under £10 million. It is only a small amount, but I hope that we are beginning to redress the balance. The BTA is also reallocating £5 million a year from within existing resources through restructuring,

1202 which will enable it to develop new marketing campaigns, provide a world-class information service in every office, further develop its award-winning internet sites and offer an improved service to the UK trade.

The tourism forum was a 57-member advisory body, which represented a wide range of organisations involved in tourism and related areas. The forum has played an invaluable role in helping us to develop our new strategy for tourism. Some 200 people, through a number of smaller working groups, considered a range of issues. I thank those people for the dedication that they gave to the task. They are all busy people who do busy jobs, and we were enormously grateful that they gave up their time.

Those groups examined human resources or people issues, a communications strategy for the industry, business tourism, cross-Whitehall issues affecting tourism, such as planning and transport, and widening access to tourism—about 40 per cent. of the population never take a holiday, and we intend to consider that matter carefully in conjunction with the social exclusion unit. One group examined visitor attractions, and another group on domestic tourism considered sustainability and quality, which are extremely important, and distribution.

A strategic planning group, chaired by the Secretary of State, has met monthly since December 1997. The industry has welcomed my right hon. Friend's commitment to the workings of the forum. Our plans for the future of the tourism forum will be set out in our new strategy to be published next year.

We are keen to offer strategic leadership to help the industry to increase its coherence and to remain globally competitive. That is why we have worked closely with the industry to formulate a comprehensive strategy. It is a determined attempt to provide joined-up government, with my Department promoting tourism's interests within government and maximising the industry's involvement in policy initiatives from across government. Key initiatives included in the strategy are aimed at promoting career opportunities in the industry, increasing access to tourism for those with low incomes, families, the elderly and the disabled, providing better information about tourism, and developing and promoting quality tourism experiences. The strategy will be about quality, value for money and service.

I am running out of time, but I should like quickly to deal with my hon. Friend's remarks about London and the river. I take on board what he said. Under the Greater London Authority Bill, the mayor will have specific duties related to tourism, and we shall carefully consider what develops from that, because it is important. We are approaching the millennium, and the millennium dome will be the biggest tourist experience for many years.